The Road Ahead
Cooperation and collaboration are the keys to continued success for credit unions, according to a group of system leaders who spoke at the recent California and Nevada CU Leagues' annual convention here.
Bob Siravo, CEO of WesCorp; Stan Hollen, CEO of CO-OP Network; Sarah Canepa Bang, CEO, Financial Service Centers Cooperative; Tony Boutelle, CEO of CU Direct Corp. (the administrator of CU Direct Lending), and Jeff Ramos, vice president of sales, CUNA Mutual Group, comprised a panel entitled "The Road Ahead."
With so many credit unions closely watching interest rates, WesCorp's Siravo said he approves of President Bush's nominee for chairman of the Federal Reserve Board, Ben Bernanke.
"He is a straight-talker, and we won't have to decipher what he says," Siravo said, a reference to retiring Fed Chief Alan Greenspan's reputation for speaking obliquely.
Before making his predictions for the future, Siravo paid homage to the Disneyland location of the conference and donned a "Sorcerer's Apprentice Mickey Mouse" hat to the delight of the audience.
"Interest rates are expected to rise into next year, then level off," Siravo said, waving a light-up wand. "Check volume will be cut in half by 2010 as paper is replaced by debit cards, credit cards and ACH."
Hollen said CO-OP Network's purchase of PULSE has made it the nation's largest credit union ATM network with 100-million transactions per month.
"We recently cooperated with WesCorp on what we believe is the first end-to-end image transfer," he said. "Significant value is added if deposits don't have to be moved."
CO-OP Network's next expansion will be into 7-Eleven locations nationwide, Hollen said.
FSCC is approaching 1,000 branches, Bang told the audience. She said California is the largest shared-branching state with 264 participants-with 300 expected by the end of the year.
"Shared branching really demonstrated the credit union difference in areas affected by Hurricane Katrina," Bang said. "It was not the way we want to sell shared branching, but it is a lesson. We need to cooperate more, and credit unions need to tell their members about shared branching. It is an odd thing to tell members to go into a branch of another financial institution," she acknowledged.
Auto Sales, Loans Up
According to CU Direct's Boutelle, there was a high volume of car sales this summer due to the so-called "employee pricing" offered by the major manufacturers. "This led to record auto loans for credit unions," he said.
In 2002, CUs did 17% of California's auto loans. As of August 2005, that figure is up to 27%, said Boutelle. He attributed the increase to credit unions having a "strong foothold" in dealerships. "I think credit unions will stay strong in auto lending in 2006," he declared.
CUDL has processed $11.7 billion in funding this year through Sept. 30, Boutelle continued. It has 527 member CUs representing 17.2 million members, plus 6,929 participating auto dealers in 41 states.
"We started in California, but we are branching out throughout the country. We hope to be in all 50 states by the end of 2006. We have a lot of work to do, but we are really happy about our momentum."